NEW YORK (AP) -- Shares of DexCom rose Tuesday after an analyst started covering the medical device company with a "Buy" rating, forecasting strong sales of its newest blood-sugar monitoring system.
THE SPARK: Benchmark Co. analyst Jan Wald set a "Buy" rating and a price target of $37 per share. He said adoption of the company's wireless system has improved since its newest version, G4 Platinum, went on sale, and sensor replacements have increased. Wald said the company's sales growth will slow down in the second half of the year as it approaches the anniversary of the approval of G4 Platinum, but he said growth so far has been impressive.
"The new sensor has driven a marked increase in revenues and we expect that this growth will continue," he said.
THE BIG PICTURE: DexCom Inc. says the G4 Platinum system is more accurate than its older system Seven Plus, especially when patients are hypoglycemic. It has a smaller sensor and longer transmission range. It also it sends an alert if the patient's blood sugar gets to a specific low level and offers customizable alerts. The Food and Drug Administration approved G4 Platinum in October.
DexCom said its product revenue grew 58 percent to $63.3 million over the first half of the year.
SHARE ACTION: DexCom stock advanced $1.13, or 3.9 percent, to $30.17 in afternoon trading. The shares have more than doubled in value in 2013 and earlier Tuesday they reached an all-time high of $30.47.
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